Outsourcing War—The Surge in Private Military Firms: Year In Review 2006

A foreign contractor guarding the joint Turkish-Canadian oil-drilling facility of Genel Enerji and Addax Petroleum in the Kurdish area of northern Iraq in May 2006.Safin Hamed—AFP/Getty ImagesThe conflict in Iraq focused renewed attention on the role played by private military firms (PMFs) in modern war. In 2006 more than 60 firms employing 20,000 armed personnel were estimated to be operating in Iraq, which made PMFs the second largest foreign military contingent, after the United States. These firms conduct vital security duties, ranging from escorting convoys of freight to protecting key facilities and leaders. The industry even has its own lobby group, the Private Security Company Association of Iraq, with nearly 50 international corporate members. PMFs have also attracted unwanted attention, however, including allegations that contractors working in 2003 as military interrogators and translators at the notorious Abu Ghraib prison in Iraq were involved in the abuses of prisoners. In March 2006 a jury found the PMF Custer Battles guilty of having defrauded the U.S. government of millions of dollars for work done while under contract in Iraq.

The Evolution of PMFs

The term PMF—also private security company and military services provider—is a catch-all expression that includes traditional security firms employing armed guards, companies shipping defense matériel, consultants offering advice on strategy, and military trainers. Unlike traditional defense industries, PMFs operate in combat zones and other areas where violence may be imminent. States, private industry, and humanitarian aid agencies all employ the services of PMFs.

The modern PMF is a product of the end of the Cold War; in the early 1990s many countries slashed defense budgets following the demise of the Soviet Union. This coincided with the growing trend of governments to outsource services to private industry. As a consequence, armed forces were left to carry out their missions with fewer ships, aircraft, and personnel, leaving more support and rear-area functions (e.g., repairing tanks, training pilots, and preparing meals) to be outsourced to contractors. It would be wrong, however, to conclude that PMFs are newcomers to warfare. Prior to the 19th century, it was common for states to contract for military services, including combat. The word soldier itself is derived from the Latin solidus, meaning a gold coin. During the 3rd century bc, Alexander the Great employed mercenary forces to help conquer Asia, and Britain hired German soldiers called Hessians to fight the colonists during the American Revolution (1775–83). In the 17th and 18th centuries, the British East India Company and its Danish, Dutch, and French rivals all had private armies to help defend their government-sanctioned business interests in Asia.

Effects on Military

A helicopter flown by PMF (private military firm) contractors circles the site of a roadside bomb attack in Baghdad in July 2005.APThe growth of the modern privatized military industry has had an effect on the armed forces that they were intended to assist. With PMFs offering daily wages of up to $1,000 to attract highly trained staff, there has been an exodus of soldiers from many special forces. Britain’s Special Air Service, the U.S. Army’s Special Forces, and the Canadian Army’s Joint Task Force 2 have all acknowledged problems retaining personnel and are offering special bonuses and pay increases in an effort to compete with lucrative wages in the private sector.

When a military organization has no organic capability, it becomes dependent on private industry to provide it. In 2000, for example, the Canadian navy had no logistics ships, and the government contracted a shipping company to take 580 vehicles and 390 sea containers full of equipment back to Canada following the completion of NATO operations in Kosovo. Owing to a dispute over unpaid bills, the ship loitered in international waters for two weeks until Canadian military personnel boarded the ship and forced it to dock in a Canadian port.

Despite these problems, PMFs are now called upon to deliver services previously considered the domain of military personnel. Kellogg, Brown & Root (KBR) runs the only permanent U.S. base in Africa (Camp Lemonier in Djibouti, at the mouth of the Red Sea). KBR has more than 700 employees who do laundry, clean buildings, and prepare meals for 1,500 military personnel. PMFs have even been employed by governments to handle domestic emergencies, such as the initial response to Hurricane Katrina in New Orleans in 2005.

Since the Sept. 11, 2001, attacks in the United States, the war on terrorism has provided new opportunities for PMFs. Spy agencies now use PMFs to collect and analyze intelligence from around the world. At times, contractors have outnumbered employees at the CIA’s offices in both Iraq and Pakistan.

Legal Issues

Three private security contractors were killed in this roadside bomb attack at Suwayrah, 50 km (30 mi) south of Baghdad, in April 2006. PMF employees often find themselves in harm’s way just the same as do regular soldiers.APInternational humanitarian law (which includes the Geneva Conventions) applies to every person in a war zone, even though the status of PMFs is not specifically defined. Hence, PMF employees are considered civilians and must not be targeted for attack unless they form part of the armed forces of a state. If these employees participate directly in hostilities, however, they lose this legal protection. Furthermore, PMF employees participating directly in hostilities are not entitled to protection as prisoners of war under the Geneva Conventions, and they can be tried as “unlawful combatants” (in other words, as mercenaries). The distinction between combatants and civilians who are merely defending themselves becomes complicated when PMF staff wear military clothing and carry government-issued or privately owned weapons. According to the International Committee of the Red Cross, when a state outsources military functions to a PMF, the state remains legally responsible for the firm’s acts.

Another legal problem is that PMF employees are usually exempt from the military laws that govern how troops behave in a conflict. Although soldiers from several coalition members in Iraq have been convicted of crimes against civilians, for example, not a single military contractor has been charged with a crime there since the U.S.-led invasion in March 2003.

Although most states publish statistics on the numbers of their military casualties, the fate of PMF personnel goes largely unreported in the news media. With few exceptions—such as the horrific public display of murdered contractors in the Iraqi city of Fallujah in March 2004—there has been little news coverage of the nearly 650 civilian contractors working for the U.S. government who were reportedly killed in Iraq between March 2003 and September 2006. Safety is another area of concern, especially when the responsibility for the safety of PMF employees working in war zones is undefined. The families of four employees who were killed in Colombia in 2003 when two surveillance aircraft crashed are suing California Microwave Systems, a subsidiary of Northrop Grumman, for negligence. Colombian guerrillas held three more employees as hostages. California Microwave Systems had been contracted by the U.S. government to conduct dangerous aerial reconnaissance missions as part of the war on Colombia’s cocaine industry.

Although some countries prohibit their citizens from joining the armed forces of a foreign country at war, very few prevent them from joining foreign PMFs. In 2006 the South African Parliament introduced legislation to prevent any of its citizens from participating in a foreign conflict. The bill—though not passed by year’s end—had its genesis in the 2004 coup attempt against the president of Equatorial Guinea. Mark Thatcher, the son of former British prime minister Margaret Thatcher, a resident of South Africa at the time, helped fund the PMF hired to conduct the coup, and it in turn hired 70 South Africans to do the fighting.

Globally, the use of PMFs has grown dramatically since the 1990–91 Gulf War, when there was an estimated one contractor for every 50 military personnel involved. By the time of the Iraq invasion in 2003, the ratio had grown to one in 10. With PMFs operating on nearly every continent and generating an estimated $100 billion in revenue annually, they are certain to remain important actors in military affairs for the foreseeable future.